I was sitting in an airport lobby the other day listening to Barbara Boxer excoriating American oil companies on CNN and calling for them to “disgorge” some of their profits if “jawboning” doesn’t work. As she spoke, I saw some people nodding their heads in apparent agreement, and I thought to myself, this California Democrat is either a first-class demagogue, a total dunderhead or some mix of the two.
She’s hardly alone — Sen. Trent Lott, R-Miss., was also on the show embarrassing himself, if not nearly as badly as she was, and there are any number of Democrats and Republicans who think it a swell idea to strip the American oil industry of some of the necessary means to help bring oil prices down now that they are so unbelievably high.
So maybe all these politicians know something I don’t know. Maybe I am being unfair in my criticism of her and some of her comments, such as, “We believe [the oil companies] are manipulating supply.” I will happily retract my harsh remarks if she and the crowd calling for a windfall-profits tax can answer the following questions:
Can they demonstrate that the price at the gas pump is unrelated to the price of crude oil on the world market? If not, can they point to the previously undetected mechanisms with which the American oil companies can affect that price more than marginally?
Can they refute the conclusion of virtually all economists and experts in the field that the oil price is principally dictated by a high demand that is currently outstripping ready, reliable supply, or are they prepared to produce a revisionist theory of how markets work?
Do they get it that it’s not high profits in and of themselves that tell us anything, but return on a dollar of sale, and are they ready to deny the widespread information that oil companies make less on a dollar of sale than any number of other industries?
Can Boxer disprove that many of those holding shares in oil companies are ordinary Americans whose future is to some degree dependent on how those pension-fund investments fare, and that cutting oil-company profits will hurt them?
Can she answer the experts who point out that a decent return on the dollar is crucial if oil companies are to receive the investments enabling them to produce larger amounts of oil and that the profits are an incentive to take the risks that could be crucial? How does she deal with the unfortunate history of trying to control oil profits? Can she explain how American oil companies are expected to compete with foreign companies if Congress weakens them?
Does she have a credible response to the observation that — if the politicians stay out of the way — high oil prices will tend to remedy themselves not only by encouraging the production of additional supplies, but by encouraging conservation and prompting use of other fuels and research into fresh alternatives?
Can she explain why she has in fact gotten in the way of oil production on a tiny portion of an Alaskan wildlife refuge, and is she aware that arguments about its being a scenic, pristine area crucial for caribou to survive were long ago shown to be false?
I am waiting, Sen. Boxer. I am waiting for you to either answer these questions or else learn a little something about the issues you are confrontingas a senator, and for you maybe to get a little more honest. I am waiting for you to convince me that you are not far more of a threat to this country than the greediest oil company CEO who ever lived.
Examiner columnist Jay Ambrose is a former Washington opinion writer and editor of two dailies.
